Research

Property Barometer – FNB Home Selling Estate Agent Survey

The multi-year stagnation in South Africa’s economy continues to suppress Consumer Confidence, and this in turn appears to have led to a more cautious Household sector.

This caution is most visible in the percentage of sellers selling in order to upgrade homes. This points to mounting financial limits, and increased household caution. However, there has only been a minor rise in financial stress-related home selling to date.

The largest motive for selling remains the ageing segment of the Household Sector downscaling to smaller properties “due to life stage”. A key indicator of perceived “relative opportunity” between South Africa and other countries, for skilled labour, is the percentage of sellers selling in order to emigrate. This motive for selling remains moderate, but has been elevated since 2013.

KEY POINTS

• FNB’s survey respondents in the 2nd quarter of 2016 indicated that “upgrade-related selling” accounted for 12% of total home selling. This represents a decline from the 14% of the previous quarter, and is now significantly lower than the 20% high reached late in 2013.

• The estimated percentage of sellers “selling in order to downscale due to financial pressure” was 14% in the 2nd quarter of 2016, mildly up from the 11% low of 3 quarters prior (3rd quarter of 2015).

• Examining the Estate Agent Survey by major metro region, the City of Cape Town would appear to be the city whose households are showing the most financial strength.

• The “Selling in order to emigrate” motive for selling remains mildly elevated off its 2% low of late-2013, as one would perhaps expect in these times of increased domestic instability. However, at 4.6% of total selling in the 2nd Quarter 2016, that percentage has not gone “through the roof”.

• The strong growth in the 50+ age cohort’s numbers is reflected in the ongoing strength in selling “in order to downscale due to life stage”, which accounts for 26% of total selling.

• At 9% of total selling in the 2nd quarter 2016 survey, selling in order to relocate to another region is slightly down from the prior quarter’s 10% estimate, but remains significantly higher than the 6% lows of the 2008/9 recession period.

Read more here: FNB Property Barometer_Estate_Agent_Survey_Reasons_for_Selling_2nd_Quarter_2016